BBVA, Spain's second-largest bank by assets, said it joined Qivalis, a group of lenders aiming to introduce a regulated euro stablecoin and challenge the dominance of digital dollars.

Adding BBVA, which has $800 billion of assets, the group now includes a dozen major European Union banks, including BNP Paribas, ING and UniCredit.

The project's goal is to create a token backed by a network of established banks, offering an alternative to crypto-native stablecoins, many of which are tied to the dollar and operated by companies based outside of the bloc.

Of the $300 billion stablecoin market, only $860 million are tied to the single currency. Tether, based in El Salvador, dominates with its $185 billion USDT, followed by New York-based Circle Internet's (CRCL) $70 billion USDC.

A euro-pegged coin could allow EU businesses and consumers to make blockchain-based payments and settlements using euros, without relying on traditional financial rails or third-party providers outside the bloc.

"Collaboration between banks is key to create common standards that support the evolution of the future banking model," Alicia Pertusa, head of partnerships and innovation at BBVA CIB, said in a statement.

BBVA's involvement "reflects the increasing dedication of European banking institutions to jointly develop a European on-chain payment ecosystem based on the trust that banks provide," said Jan-Oliver Sell, CEO of Qivalis and a former executive of Coinbase Germany. "This step consolidates Qivalis’ standing as Europe's foremost bank-supported stablecoin initiative."

Qivalis is currently pursuing authorization from the Dutch central bank to operate as an electronic money institution, a step required to issue stablecoins under the EU’s digital asset regulatory framework dubbed MiCA.

The project plans to debut the token in the second half of 2026.

Read more: BNP Paribas Joins EU Bank Stablecoin Venture Helmed by Ex-Coinbase Germany Exec